With only 37 residents, ten houses and two streets, the village of Jamel seems harmless.

But this small part of Mecklenburg-Western Pomerania has been taken over by neo-Nazis.

Observers say that at least two thirds of Jamel's residents identify with the far-right extremist National Democratic Party (NPD) of Germany and its anti-foreigner platform. The local magnate is Sven Krüger, an NPD representative on the district council.

According to reports, the town has become a place of pilgrimage for neo-Nazis from around the country.

Now a newly ordained rabbi in nearby Brandenburg says he fears wearing a kippah in public, lest he be harassed.

Although no violent incidents have been reported recently, the concerns are real, says mayor Uwe Wandel.

Mr Wandel says that high unemployment provides fertile ground for the far-right parties, who blame problems on outsiders.

"The NPD has changed its strategy, they are not carrying out brutal beatings these days," Mr Wandel said. "They try to build support in other ways, and I find it much more dangerous."

Recently, the NPD, which has an estimated 7,000 members nationwide, announced that it would merge with the smaller German People's Union to form the 'NPD - The People's Union'.

Their goal is to create a stronger force in local elections in several German states, including Mecklenburg-Western Pomerania, where the NPD currently has six seats.

"The party is trying to put on a good image," Mr Wandel said, "but their actual interests remain the same. They are as ultra-nationalist as the Nazis were in 1933. You should not underestimate them. They are attacking Turks instead of Jews today, but they are no less dangerous."

The party is also known for relativising the Holocaust. Members routinely claim that the suffering of Germans during the Second World War is overlooked. NPD lawmakers in the state of Saxony once walked out of the local assembly during a Holocaust remembrance ceremony.

In the former East German state of Brandenburg, newly ordained Rabbi Shaul Nekrich, 31, reported he feels unsafe wearing a kippah in the region, where he represents six congregations and some 1,300 Jews. He told reporters recently that local Jews fear being recognised as Jews in the street.

In Jamel, in response to the growing presence of the far-right, residents have hosted a pro-democracy music festival each year since 2007. Birgit and Horst Lohmeyer organize the event "so this village does not fall into the hands of the right wing and to build public trust," said Mr Lohmeyer.

Some argue that legal measures should also be taken. Recently, newly elected chair of the Central Council of Jews in Germany, Dieter Graumann, called for banning the NPD.

But Mr Wandel argues: "A ban would not solve the problem. They would just form into another group."